What occurs when a good becomes relatively cheaper?

When a good becomes relatively cheaper, it typically leads to an increase in its demand. This relationship is grounded in the basic principles of economics, particularly the law of demand, which states that, all else being equal, as the price of a good falls, the quantity demanded for that good generally rises. Consumers are more likely to purchase more of a good when it is less expensive compared to other goods, making it more appealing as a choice.

As the price decreases, the purchasing power of consumers effectively increases, allowing them to buy more of that good, which contributes to the overall increase in demand. Other factors, such as consumer preferences and the availability of substitutes, also influence demand; however, the primary reaction to a relative price decrease is an increase in quantity demanded for that particular good.